Report: Liberty Media Expected To Negotiate With iHM Creditors

The Denver-based media tycoon John Malone is angling to take control of iHeartMedia as soon as it gets out of bankruptcy early next year, sources told The NYPost.

On Monday, iHeart creditors approved a reorganization plan that will slash the company’s crippling debt load by two-thirds and return it to the public markets in February.

Meanwhile, Malone’s Liberty Media is gearing up for a flurry of negotiations with iHM’s creditors to assemble a stake of roughly 35 percent in iHM, sources told The Post.

Asked about the iHM plans, Liberty  on Monday referred to a Nov. 14 analyst call, in which its president and chief executive, Greg Maffei said, “I just don’t think at this time we’re going to be increasing our stake.”

Nevertheless, insiders say Liberty is determined to execute its longer-term vision. Gaining control of iHM would give Liberty a music four-pack, as it already owns 71 percent of publicly listed SiriusXM Radio. Sirius in September agreed to buy streaming service Pandora Media. Liberty also owns 33 percent of listed Live Nation Entertainment, which owns Ticketmaster..

The suite of properties could enable Liberty to start a formidable record label that’s capable of boosting artists’ profiles and offering them a larger share of music revenues than what traditional labels can, Citigroup analyst Jason Bazinet noted in an October report.

Liberty's John Malone

“That is, the new firm could push songs over satellite radio (via Sirius on an ‘emerging artist’ channel), over playlists (via Pandora) or over FM radio (via iHeart),” Bazinet wrote, adding that a speculative Liberty label “could book newer artists at a festival a little earlier than normal, potentially exposing the emerging artist to new fans.”

Sources said that iHeart lenders will own almost all the post-bankruptcy shares and many of them would like to exit at a reasonable price.

Apple, which has been rumored to be interested in iHM, only wants a small equity stake, possibly in exchange for trading services, a leading creditor said.

Liberty is expected to want only a minority iHM stake so it does not have to consolidate financials and hurt Liberty’s trading multiple, the source said.